Week of August 5, 2002
  Project Watch
Sysco Chooses North Virginia for 388-Employee
Redistribution Center, Company's First
Front Royal, Va.
Sysco's first redistribution center will be built in Front Royal (pictured), a city of
some 32,000 residents in Northern Virginia's Shenandoah Valley.
FRONT ROYAL, Va. – Virginia has won out in a five-state race to land the first U.S. redistribution center for Sysco, North America's largest food-service marketing and distribution firm. Houston-based Sysco has announced that it will locate the US$53 million, 388-employee center in the city of Front Royal, Va.
        The facility will initially span 800,000 sq. ft. (72,000 sq. m.), Sysco officials said. The Front Royal operation will include freezer, refrigeration and dry storage space, as well as cold docks and rail dock areas.
        More space could be in the offing, though. The operation in Virginia's Shenandoah Valley will be designed to be expandable to as much as 1.2 million sq. ft. (108,000 sq. m.).
        "We are very optimistic about the prospects for our growth and development in Warren County," said Sysco Executive Vice President Kenneth Spitler.
        "The Virginia location," Spitler continued, "was chosen because of the broad-based available work force, as well as the outstanding communities and quality-of-life amenities they offer potential employees."
        "Sysco will benefit from Warren County's dedicated work force and access to the Virginia Inland Port, which helps position the state as a major distribution hub," said Virginia Gov. Mark Warner.
        Sysco is receiving a number of incentives, the collective value of which wasn't disclosed. Warner has approved a $200,000 grant from the Governor's Opportunity Fund to assist Warren County with the project. The Virginia Dept. of Business Assistance will provide work-force training for Sysco's Front Royal employees. The company will also qualify for a number of other incentives, including rail access funding from the Virginia Dept. of Rail and Public Transportation, road access funding from the Virginia Dept. of Transportation and enterprise zone tax credits, state officials said.

First of Six Centers in New
Sysco Redistribution Network
Virginia beat out Maryland, New Jersey, Pennsylvania and West Virginia for the redistribution center, state officials said.
        Sysco officials praised the project assistance provided by the Virginia Economic Development Partnership, the Virginia Port Authority and the Front Royal-Warren County Economic Development Authority.
        Project construction will begin sometime in late or mid-September, they added. Completion at the site north of I-66 is expected by the fourth quarter of 2003.
        The Front Royal redistribution center will serve 14 existing Sysco distribution centers, which are located in Connecticut, Maine, Maryland, Massachusetts, New York, Pennsylvania and Virginia. The Virginia redistribution center is only the first of six that Sysco is setting up, locating one in each of its six North American operating regions.
        That redistribution network is being established to increase the company's transportation savings and to improve its storage and handling methods, Sysco officials said. The six redistribution operations, Spitler asserted, will create a corporate supply-chain system that's more efficient than the methods currently used to deliver products to distribution centers.

Company Has Upped Sales,
Earnings for 26-Plus Straight Years
The Virginia announcement comes shortly after Sysco released a report detailing its 105th consecutive quarter of increased sales and earnings.
        When it made its first public offering in 1970, Sysco had annual sales of only $115 million. For fiscal 2002, the 46,000-employee company recorded $22.6 billion in sales.
        That growth has made Sysco Houston's largest company, according to financial services firm Sanders Morris Harris.
        The continuation of the company's growth curve in fiscal-2002 came during what Sysco Chairman and CEO Charles Cotros called "one of the most challenging fiscal years in Sysco's history."

Editor's note: For more on the Old Dominion State, see
the Virginia Spotlight Section in the November Site Selection.

Tractebel Taking $500M Plant to Monterrey, Mexico

Monterrey, Mexico
Dubbed the "Sultan of the North," Monterrey (pictured) is Mexico's third largest city.
LAZARO CARDENAS, Mexico – Belgium-based energy giant Tractebel is powering up in Mexico, building a $500 million cogeneration plant just outside Monterrey. The new operation, which will have a capacity of 245 MW of electricity and up to 235 MTPH of steam, will be located in the city of Lazaro Cardenas in northern Mexico, Tractebel officials said.
        Tractebel de Mexico has acquired the rights to a 225-acre (90-hectare) site at the Port of Lazaro Cardenas, reported port officials. Picking that location near Monterrey - one of the nation's largest cities, with a population of more than 3 million - positions Tractebel's energy-generating operation near a large cluster of customers.
        Mexico's energy demand has skyrocketed in tandem with the nation's rapid economic growth, making it an appealing market for international power suppliers. The country's rapidly rising demand curve was one major reason for locating Tractebel's new operation in northern Mexico, said Dirk Beeuwsaert, CEO of Tractebel Electricity and Gas International.
        "This project represents an excellent opportunity for Tractebel to increase its presence in a Mexican energy market that's rapidly growing," Beeuwsaert explained. "This cogeneration facility will be ideally situated in a region where there is high demand for energy, available infrastructure and potential for future integration with U.S. natural gas and electricity markets."

Company's Growth Reflects Demand Curve
A subsidiary of Brussels, Belgium-based Tractebel, Tractebel de Mexico has compiled a torrid expansion track record that reflects Mexico's jackrabbit growth in energy demand. Formed in late 1999, Tractebel de Mexico owns three natural gas distribution operations, which are located in Guadalajara, Querétaro and Tampico. In addition, Tractebel subsidiary Trigen Energy Corp. operates a cogeneration facility, also located in Tampico, which produces both steam and chilled water.
        Tractebel de Mexico's rapid expansion has enabled it to become the only company in Mexico that provides industrial customers with electricity, gas and energy-related services. The Mexican subsidiary has already lined up agreements for distributing output from the Lazaro Cardenas operation.
        Steam from the plant will be purchased by Industrias Acali, a subsidiary of Vitro, Mexico's largest manufacturer of glass containers. Tractebel de Mexico's plant in the state of Nuevo Leon also has a 15-year agreement to supply gas to PGPB, a natural gas subsidiary of Pemex, Mexico's state oil corporation. In addition, the company's newest Mexican operation has signed an agreement with CFE, the Mexican state power company, to provide back-up power, energy trading and interconnections.

$500M LNG Plant Planned in Same Area
Tractebel de Mexico is eyeing yet more growth - and soon - in Lazaro Cardenas. Tractebel's Mexican arm already has plans on the drawing board for a $500 million LNG re-gasification complex, which would also be located in the city's port, company officials said.
        That project, however, must still secure final approval before it proceeds full bore. Mexican federal officials are now carrying out a feasibility study on locating an LNG complex in Lazaro Cardenas. No legal framework has been established to date for an LNG plant to operate in the area. Officials expect the feasibility study to be finished sometime in August.
        Another high-profile project is also on tap for the same port, according to Lazaro Cardenas Port Authority officials. An automaker, they said, is going to build a storage facility in the port that will be able to handle 1 million vehicles a year.
        Port officials, however, didn't divulge the name of the automaker, or the projected timing for the project.

Editor's note: For more on business locations in Mexico, see
the Mexican coverage in the upcoming November Site Selection.

ComEd, Partners Creating $65M Wind Farm in Illinois

pw020805c.jpg - 8793 Bytes
Located in a 2,200-acre (880-hectare) belt of Northern Illinois farmland, the Crescent Ridge wind farm will use turbines far, far higher than an elephant's eye: Each of those units will stretch 380 feet (115 meters) high and will be equipped with three-blade rotors with a 235-foot (71-meter) diameter.
CHICAGO and TISKILWA, Ill. – A $65 million project that's taking shape in Illinois is a rock-solid lock to blow up a storm.
        Commonwealth Edison (ComEd), one of the largest U.S. utilities, has joined forces with two other companies in announcing a venture to create 34 wind turbines near Tiskilwa, Ill., some 110 miles (176 kilometers) west of Chicago. The three-pronged alliance comes as a host of utilities are striving to develop alternative energy sources. Several major factors are intensifying pressures for greater use of "green power." One huge factor: Traditional power sources like coal and oil will eventually simply run out, many leading scientists and energy analysts agree. Another major factor is the continually higher profiles that environmental issues are assuming in site selections, particularly with manufacturing projects.
        The new Illinois endeavor will answer part of that challenge by creating one of the largest North American wind farms east of the Mississippi River.
        "Wind power is a desirable alternate source of energy because it is renewable and environmentally friendly," said Arlene Juracek, ComEd vice president of regulatory and strategic services.

ComEd Sole Customer for Power Output
Illinois Wind Energy (IWE) and Tomen Power Corp. (TPC) are ComEd's co-developers on the wind farm in north Illinois, which will rise in Bureau County's Crescent Ridge area.
        "This project puts Illinois Wind Energy at the forefront of commercial-scale wind development in Illinois," said Stefan Noe, president of IWE, an Illinois limited liability company that was formed in September 2000 to develop utility-scale wind farms in the Prairie State.
        The Crescent Ridge project will take shape inside a belt of 2,200 acres (880 hectares) of working farmland. The 34 wind turbines, however, will only occupy 20 (eight hectares) acres of that space. All the surrounding land will be unaffected and will continue to be available for farming, ComEd officials said. The 24 turbines will have a collective output of 51 megawatts, enough electricity to power 20,000 homes.
        ComEd, which has more than $15 billion in annual revenues, will be the Crescent Ridge wind farm's sole customer.
        "The power purchase agreement with ComEd provides the economic assurance to make this project possible," Noe said. "ComEd has not only made a significant commitment to help bring the Crescent Ridge wind project to life, but also is making a significant commitment to the environment and to Illinois' future."
        TPC, the project's third partner, is financing the wind farm. TPC is a subsidiary of Tomen Power Holdings, one of the largest wind-power developers, with operating facilities accounting for some 5 percent of the world's total wind-power generation.

Gusts of Air Can Be a Location Plus
More than a few areas futilely try to land expansion projects by largely blowing hot - and empty - air, many site selectors contend. Fast-blowing air, however, was exactly why the Tiskilwa area landed the new wind farm.
        The Crescent Ridge area has an average wind speed of 17 miles per hour (27.2 kilometers per hour), one of the state's highest rates. Illinois as a whole ranks 16th among U.S. states in wind-power generating capacity.
        "Illinois is positioned to be a leader in renewable resources, especially with respect to wind generation," Juracek said.
        The strong gusts at Crescent Ridge are a must, given the huge dimension of the wind farm's 34 turbines. Those turbines are 380 feet (115 meters) high, equipped with three-blade rotors that stretch out 235 feet (71 meters) in diameter. Rolling Meadows, Ill.-based NEG Micon will supply the turbines for the Crescent Ridge wind farm.
        One of the state's most notably wind-worthy locales - Chicago, the fabled Windy City - is watching the Crescent Ridge project with interest. Chicago has a five-year goal of deriving a fourth of its total power from alternative sources. The city intends to meet its 20-percent goal for "green power" by utilizing a mix of hydropower, solar power and power from landfill gas, Chicago officials said.
        Chicago, however, will need to separately negotiate with ComEd to secure part of the Crescent Ridge farm's output. That's just what the city intends to do, according to Dept. of the Environment Commissioner Marcia Jimenez.


©2002 Conway Data, Inc. All rights reserved. Data is from many sources and is not warranted to be accurate or current.